Charter Hall Retail REIT lists Coles Earlwood for more than $23 million

Charter Hall Retail REIT, which fully owns the property, has a $2.9 billion portfolio of 66 retail assets across Australia, with a focus on convenience-based centres.

Coles Clayton, in Melbourne, sold for more than $17 million – some $7 million above the guide. Photo: Supplied

The value of the portfolio hiked up by 5.2 per cent in the six months between June and December 2017, the trust’s 2018 financial year interim results reported in February. NSW accounts for $1.36 billion worth of properties.

Zoned for local centre use, the Earlwood site has a building height of 14 metres and allows for developments including shop-top housing, boarding houses, childcare centres and tourist accommodation to be built with consent.

The property, which comes with 86 car park spaces, is leased to Coles supermarket and an ancillary BWS liquor store.

CBRE’s Nick Willis, who has the listing with Justin Dowers, said freestanding supermarkets in inner Sydney were rarely sold.

“Coles Earlwood marks one of the first freestanding supermarkets to be formally offered for sale in Sydney in almost three years,” Mr Willis said.

Charter Hall Retail REIT is selling the Thornleigh Marketplace on Sydney’s upper north shore for more than $40 million. Photo: Airphoto Australia

“This property provides the incoming purchaser an opportunity to acquire not only a secure and growing income stream but also the potential to unlock a future mixed-use development.”

Mr Dowers added that there had been “significant interest” from national and international investors in freestanding supermarkets.

The listing comes hot on the heels of Charter Hall Retail REIT’s $229.8 million divestment of 11 shopping centres in the second half of 2017.

According to the trust’s 2018 financial year interim results, the sell-off is part of a broader strategy to upgrade the portfolio quality by recycling its lower-growth properties into higher growth assets, targeting convenience-based shopping centres that are the dominant mall within their catchment.

Charter Hall Retail REIT is also selling Gordon Centre on Sydney’s upper north shore for more than $150 million. Photo: Supplied

In March, the trust listed the three-level Thornleigh Marketplace on Sydney’s upper north shore, of which it has a 50 per cent stake, with the other half owned by Telstra Super. That property is expected to fetch $40 million.

Gordon Centre, another asset owned by the trust on Sydney’s upper north shore, was listed last October with hopes of more than $150 million.

The Charter Hall fund also acquired Salamander Bay Centre in NSW and the Highfields Village Shopping Centre for a combined $215.5 million in May and June 2017 respectively.

Coles-tenanted properties are proving to be hot commercial assets, with a Coles supermarket in Clayton, Melbourne, fetching $17,115,000 on a record yield for supermarkets of 2.57 per cent in late March.

That property had a price guide in the sub-$10 million range, meaning it sold for some $7 million above expectations.